Bitcoin Plunged Hard Ahead of FOMC Minutes—Why Crypto Market is Down Today?

Bitcoin Price Plunges, Triggering Market Decline

The Bitcoin price has witnessed a sharp decline, approaching $96,000 and driving the market below its support levels. Concurrently, Ethereum has experienced an 8.97% drop, trading at $3,348. XRP and SOL have also incurred losses of 4.25% and 9.12%, respectively. Dogecoin and Cardano have faced significant pullbacks exceeding 10% and 9%, with other altcoins exhibiting similar downturns.

Despite a surge in global trading volume by over 33.12%, reaching $170 billion, the market capitalization has dropped to $3.36 trillion, representing a 6.38% decline.

Factors Influencing the Crypto Market Plunge

Two key events loom on the horizon: the ADP Nonfarm Employment report and the FOMC meeting minutes. While ADP provides an early glimpse into the health of the labor market, the FOMC minutes offer insights into the Federal Reserve's stance on interest rates, which can significantly impact the Bitcoin price.

Current Market Conditions and Future Outlook

Liquidations have surged, peaking at $558 million in the long term, with Bitcoin accounting for almost $100 million. The pressure remains unabated, with resistance encountered on both sides.

A liquidation heatmap from Coinglass indicates that short positions are being established at strategic levels. If the Bitcoin price rallies to $98,600, over $35 million will be liquidated, while a recovery above $103,300 would trigger liquidations of over $66 million. This suggests a level of pessimism among traders or uncertainty regarding the sustainability of the rally.

Despite these corrections, certain altcoins, including XRP, XLM, and BNB, have demonstrated resilience, hinting at a possible rebound in the near future. Meanwhile, Bitcoin's dominance remains within a narrow range, indicating the potential for an altseason on the horizon.